Supreme Court Leaves Open Door to Wealth Taxes - Alliance for Justice

Supreme Court Leaves Open Door to Wealth Taxes

Press Release


Money in Politics

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Zack Ford

WASHINGTON, D.C., June 20, 2024 – Today the Supreme Court issued its decision in Moore v. U.S., ruling that taxes on investments are constitutional. The case was a challenge to Congress’s ability to tax income that has not been “realized” through sale of assets but also an attempt to preempt other forms of taxes on wealth.

In the 7–2 decision, Justice Kavanaugh notes Congress’s “broad power to lay and collect” taxes and explains that the Mandatory Repatriation Tax is constitutional. While the Moores argued that their investment returns could not be taxed because they had not been “realized,” the opinion explains that the income has been realized by the company in which they are invested. The Court finds that it is thus constitutional for Congress to tax shareholders for their share of that income.

A concurrence by Justices Barrett and Alito confirms that this case was very narrowly decided specific to shareholders of a closely held foreign corporation. A dissent from Justices Thomas and Gorsuch shows that there were two votes ready to rule the tax unconstitutional.

Alliance for Justice Vice President of Strategy Keith Thirion issued the following statement:

“There are Supreme Court cases every year where the specific details seem nuanced but the consequences can prove massive. Moore v. U.S. was one of those cases because of the threat it posed to hypothetical policies that have never even been passed into law. At a time when 10% of earners control two thirds of all wealth, we need to examine ways to ensure everybody is paying their fair share to create a society in which we can all prosper. It’s a relief to know that today’s narrow ruling leaves options on the table, but we must be vigilant in responding to these obvious efforts to give even more power to those who already control more than most of us can imagine.

“It is no surprise that Justice Thomas sided with the billionaires given that the wealthy and privileged have plied him with ludicrous sums of gifts during his time on the bench. His decisions are compromised, and he must resign.”